The Department of Banking News Bulletin
Bulletin # 3163 - Week Ending October 4, 2024
This Bulletin constitutes the only official notification you will receive from this office concerning any of the following applications. Any observations you may have are solicited. Any comments should be directed to Jorge L. Perez, Banking Commissioner. Written comments will be considered only if they are received within ten business days from the date of this bulletin.
CONSUMER CREDIT DIVISION ACTIVITY
Temporary Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Issue Order to Cease and Desist and Notice of Intent to Impose Civil Penalty
On September 23, 2024, the Commissioner issued a Temporary Order to Cease and Desist, Order to Make Restitution, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Order and Notice”) in the matter of: Alliance (“Respondent”), Kenmore, New York. The Order and Notice was the result of an investigation by the Consumer Credit Division. The Commissioner alleges in the Order and Notice that: (1) Respondent’s acting within this state as a consumer collection agency without a consumer collection agency license, constitutes at least one violation of Section 36a 801(a) of the Connecticut General Statutes; (2) Respondent’s using false, deceptive or misleading representations in connection with the collection of a debt, including falsely representing that the debt was owing and being collected on behalf of Zoca Loans and that a lawsuit would be filed against the Connecticut consumer should the debt remain unpaid, constitutes violations of subdivisions (2)(A), (5) and (10) of Section 36a-809-11 of the Regulations of Connecticut State Agencies; and (3) Respondent’s using false, deceptive or misleading representation or means in connection with the collection of any debt, including falsely representing that the debt was owing and being collected on behalf of Zoca Loans and that a lawsuit would be filed against the Connecticut consumer should the debt remain unpaid, constitutes falsely representing the character, amount or legal status of a debt, in violation of 12 CFR Section 1006.18(b)(2)(i) of Regulation F, threatening to take action that cannot legally be taken or that is not intended to be taken, in violation of 12 CFR Section 1006.18(c)(1) of Regulation F, and using any false representation or deceptive means to collect or attempt to collect any debt, in violation of 12 CFR Section 1006.18(d) of Regulation F, which constitute at least three violations of Section 36a-812 of the Connecticut General Statutes. The Commissioner found that the public welfare required immediate action to issue a Temporary Order to Cease and Desist against Respondent. Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Order and Notice.
Consent Order
On October 2, 2024, the Commissioner entered into a Consent Order with LoanSnap, Inc. d/b/a LoanSnap (NMLS # 76967) (“LoanSnap”), Costa Mesa, California. The Consent Order was based on an investigation by the Consumer Credit Division. As a result of such investigation, the Commissioner alleged that: (1) LoanSnap used an address other than the address specified on the Nationwide Multistate Licensing System and Registry (“NMLS”), in violation of Section 36a-490(b)(2) of the Connecticut General Statutes, resulting in the automatic suspension of its license to engage in the business of a mortgage lender in Connecticut on July 11, 2024; (2) LoanSnap failed to file with NMLS a change of address of its main office at least thirty (30) calendar days prior to such change and failed to provide a bond rider or endorsement, or addendum, as applicable, to the surety bond on file with the Commissioner, in violation of Section 36a 490(b)(2) of the Connecticut General Statutes; (3) LoanSnap failed to implement policies and procedures acceptable to the Commissioner to effectuate subparagraphs (a) through (c), inclusive, of paragraph 4 of the Consent to Entry of Sanctions within the Consent Order dated May 15, 2024 previously entered with the Commissioner (“May 2024 Consent Order”), in violation of the May 2024 Consent Order; (4) LoanSnap and its control persons failed to timely disclose the May 2024 Consent Order on NMLS, in violation of Section 36a-490(c) of the Connecticut General Statutes; (5) LoanSnap made or caused to be made false statements in its Company (MU1) Form on NMLS, in violation of Section 36a-53a of the Connecticut General Statutes, specifically that (a) at all times relevant hereto, LoanSnap falsely stated that it did not have any unsatisfied judgments or liens against it, when in fact a default judgment was entered against LoanSnap in suit filed by Wells Fargo Bank, N.A. in the United States District Court of Minnesota in the amount of $431,511.75 on November 7, 2023 (Case No. 23-cv-2626(DWF/JFD)), which to date remains unsatisfied, and (b) at all times relevant hereto, LoanSnap falsely stated that it did not have any pending financial services-related civil actions in which the entity is named, when in fact at least three financial services-related civil actions were pending; (6) LoanSnap failed to file on NMLS its 2024 Quarter 1 Mortgage Call report due May 15, 2024, in violation of Section 36a-534b(c) of the Connecticut General Statutes; and (7) LoanSnap advertised to consumers on its website that it was licensed in states in which it was not, in violation of Section 36a 498d(b) of the Connecticut General Statues. The Commissioner also alleged that LoanSnap failed to demonstrate that its financial responsibility, character and general fitness are such as to command the confidence of the community and to warrant a determination that LoanSnap will operate honestly, fairly and efficiently within the purposes of Sections 36a-485 to 36a 498e, inclusive, 36a-498h, 36a-534a and 36a-534b of the Connecticut General Statutes, as required by Section 36a 489(a)(1)(C) of the Connecticut General Statutes. As part of the Consent Order, LoanSnap’s license to engage in the business of a mortgage lender in Connecticut was revoked.
Dated: Tuesday, October 8, 2024
Jorge L. Perez
Banking Commissioner